MainFinanceTrump Threatens to End GM Electric-Car Subsidies, Without Saying How

Trump Threatens to End GM Electric-Car Subsidies, Without Saying How

28 November, 2018

Other plants in the United States includes the propulsion plants in White Marsh, Maryland that makes pickup truck transmissions and the transmission factory in Warren, Michigan that also makes gearboxes - mainly a 6-speed unit that is used across the board.

Reacting sharply, Trump asked the General Motors to review its decision, which the auto major said would help it save around Dollars 4.5 billion in costs by the end of 2020.

Mr Trump unleashed the comments on Twitter a day after GM announced it would close down five auto factories and slash 14,000 jobs in North America, with numerous job cuts coming from the Midwest, where the President has promised a rebirth of manufacturing.

Trump went on threaten to cut all GM subsidies - including those for electric vehicles.

Larry Kudlow, director of the National Economic Council, says the disappointment has been amplified by the fact the cuts are coming in the wake of the newly reached U.S. -Mexico-Canada Agreement, one of Trump's signature achievements on trade. "I am here to protect America's Workers!" he declared.

Mr Kudlow, who met with Ms Barra on Monday, said Mr Trump felt betrayed by GM, which the Government had been trying to help. "We've done this to help you and I think his disappointment is, it seems like that they kind of turned his back on him".

Kudlow says he didn't see a recession in the offing and didn't rule out that the White House may take action against GM.

"We appreciate the actions this administration has taken on behalf of the industry to improve the overall competitiveness of USA manufacturing".

The U.S. government gives auto companies a $7,500 federal tax credit for every electric vehicle that GM sells, up to 200,000 vehicles.

White House press secretary Sarah Huckabee Sanders did not elaborate as to what cuts could be enacted. The company plans to lay off thousands of salaried workers in January.

Trump has long promised to return manufacturing jobs to the United States and particularly the Midwest.

The company said the cuts - 2,500 jobs in Oshawa, GM's Canadian heartland, as well as 3,300 production workers in the USA and 8,000 salaried staff - are part of a dramatic course correction aimed at better positioning GM for the dominance of electrified, interconnected and automated automobiles.

The reductions could amount to as much as 8 per cent of GM's global workforce of 180,000 employees. In October, nearly 65 percent of new vehicles sold in the US were trucks or SUVs. That figure was about 50 per cent cars just five years ago.

Meanwhile, it's a fallacy to suggest that the new deal could have either prevented or ended up expediting the cuts, said Dan Ujczo, an OH trade lawyer who hails from Lordstown, the same community outside Cleveland that's home to one of the five GM plants where production is to cease next year.

GM added this to its statement: "Many of the USA workers impacted by these actions will have the opportunity to shift to other GM plants where we will need more employees to support growth in trucks, crossovers and SUVs".

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